Should You Owner Finance Your Piscataway, New Jersey Home For Sale?

By
Real Estate Agent with Metuchen Keller Williams Elite Realty / Middlesex County, NJ

You've decided to put your Piscataway - New Jersey home up for sale.  Now, how are you going to make the most money selling it and get it sold the fastest?  Perhaps you should consider providing owner financing, also known as seller financing. 

Home Financing your Piscataway home for sale

Why Isn't The Buyer Getting Bank Financing?
Usually a buyer gets bank financing when buying a home.  If the buyer approaches you with a deal that involve you doing the financing, you'll want to ask why.  It could be that they can't afford a big down payment, and can't be approved for a loan without it.  Or, they may not be able to get financing at all, due to no credit or bad credit.

In that case, you'll want to evaluate if you can afford the risk.  Can you make the monthly mortgage payment in the event they default? If you determine that the deal isn't too risky, you can finance the home yourself for a greater profit.  But, there are some instances when you won't be able to owner finance your Piscataway home for sale.

When Can't I Owner Finance My Home?
You may not know that in order to finance your home yourself, you have to be able to pay off your current mortgage in full prior to making the sale.  If you can't afford to make the full payment, you won't be able to owner finance the property.

If you already own the house outright, you'll be able to finance the property.  You may decide to owner finance part of the sale price for a higher interest rate.  This would be an ideal situation for a buyer who can qualify for a bank loan for most of the sale price, but is unable to be approved for a higher loan amount to get the rest.

After a year of making payments to the bank, the buyer may be able to finance the remaining amount, and then you'll receive a lump sum for that amount. 

What Else Do I Need to Know?
There are a lot of things to take into consideration before deciding if owner financing is right for you.  Be sure to do your homework and understand the benefits and risks of owner financing.  It is also wise to consult with a real estate lawyer and a professional real estate agent.

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Cathy Chaudemanche
Realtor Associate/Keller Williams Realty
Metuchen, NJ
Servicing Home Buyers and Sellers in Middlesex County, NJ
http://www.YourHouseFast.com

Posted by
Catherine "Cathy" Chaudemanche Team, ABR, SRS, SRES
Local Realtor Associate - Agent Leadership Council
New Jersey Association of Realtors Circle of Excellence Sales Award - 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018
Certified Luxury Home Marketing Specialist
 
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